'Sect', as opposed to cult, denotes a splinter group from an established religion. For example, Christianity was initially a sect of Judaism, while now, groups such as baptists can be considered a sect of Protestant Christianity. Indeed, Protestantism began as Martin Luther's splinter group from Roman Catholicism.
In other words, a sect is simply a relatively new denomination of an existing religion: too sane to be a cult, and too small or dependent on its beginnings to be a separate religion.